You are to read the Make or Buy document and then carryout the sample spreadsheet tasks, by

using the spreadsheet as a tool to tell us at what point in production /sales does it become viable to
make a product rather than "Buy it in " from a competitor.

A cash flow forecast is a plan that shows how much money a business expects to receive in, and pay
out, over a given period of time.

Carry out these tasks below. Send them to me via email when finished.

Task 1 Make or Buy: https://www.youtube.com/watch?v=cWp7osRAFhc

Jacks Auto Sales

Jack Smith needs to decide if his company will process loans internally or externally, considering his
costs.

Q.1 If jack Insources his work, he will have “Fixed Cost” of $2500 and he will have access to the
“Top notch credit company”, each loan he processes will cost $25.

If jack Insources his work, he will have “Fixed Cost” of $1000 and he will have access to the

“Easy Loan credit company”, each loan he processes will cost $35.

Q.2 As jack is indifferent to internal processing and outsourcing, he will opt for the best for his
company business. His company is presently gaining more clients each week to make loans to. What
should he do? Insources or outsource his work. Please give reasons

Formula: Q=(FCmake-FCBuy)/(VCBuy-VCMake)

Task 2 Cash Flow Forecast https://www.youtube.com/watch?v=C5PcUSmfOZU

Spread sheet Task 1.

Using a copy of the Cash Flow Model 1 create an updated model using the initial data as shown
below. Call this Cash Flow Model 2
Task 2 Compare and Contrast the two Models.

Cash Flow Model 1

The Models are works well; the spreadsheet knows nothing other than the data you entered into the
worksheet.

1 Model 1 has a total of £800 goods for resale. What value of sales did they make that
year, and what value of sales have they left for the following year?

2 Model 2 has a total of £1,400 goods for resale. What value of sales did they make that
year, and what value of sales have they left for the following year?

2a the answer to question 2 looks a bit strange. The worksheet is correct, in line with the
formula used and the data input, but it makes no sense. Please look at the “Goods for
Resale” and “Sale”. How much have we sold compared to how much we have available
to sell?

Answer:

Can you think why this is suspect, and what would we have to do to make the model
more reasonable.
Answer:

3 Make alterations to the “Sale” row in Model 2, to make it so that the total sales for the
year are as close to the “Goods for sale “as possible without going over.
Answer:
Assignment 1 your name?

Q.1 Screen shot of the Buy or Make spreadsheet here, give it a title and explain in less than 200
words what it is used for

Q.2 Screen shot of the